Business Start-Up
Start-up grants
One of the main questions that is so frequently asked is what grants and funding are available to start a business in the UK. If you have visited my page on business grants you will recall that grants are normally only given when there are specific issues that the government or local authority wishes to address.Generally grant funding is only given when there is a clear market failure. Generally business start-up does not fall within that category.
So does this mean all is lost if you want grant funding to start a new business? Actually no, you just have to look carefully and find grant funding that suits your part of your need and is available to start-up businesses. Also local authorities occasionally offer lower value (~£1000) enterprise grants, but these are rare and schemes frequently disappear as quickly as they appear.
Generally however business start-up funding comes from 3 sources: personal savings, friends and family, or a high street bank. Lending from a high street bank may be made available under the current Enterprise Finance Guarantee, for which your business has to be viable.
Can't get a bank loan?
Another alternative to investigate is to see if your Regional Development Agency (see my links page for your local RDA) has loan schemes available for those unable to access traditional bank loans. These are generally targeted at specific geographical and/or business sectors but can prove useful.
An example of an available grant being used to start-up a business
To give you an example of how this might work, say you are starting a business to develop a piece of new technology. You need about £40,000 to get it developed. You apply for a Micro Grant under Grant for Research and Development. This grant is project based grant but as a start-up the business is the project and vice versa. On that level of spend the grant value is £18,000, leaving £22,000 to be funded by friends, family, credit card, bank loan and/or overdraft. Don't forget that you must have a project that is viable for the grant scheme you wish to apply for. Packaging funding like this is key for many businesses.
Please feel free to contact us to discuss packaged finance options for your business.